Executive Briefings

Lean Supply Chains: A Never-Ending Quest

Lean is a never-ending process, says Mike Buseman, chief global logistics and operations officer with Avnet Inc. He explains how the company operates in a state of continuous improvement.

The task of applying Lean strategies to company operations is "an ongoing journey," says Buseman. These days, Lean is being coupled with Six Sigma and change-management practices to provide the core of internal improvement efforts. "Together, they become a continuous-improvement background," he said.

An effective Lean program requires collaboration among all aspects of the organization. Buseman says Avnet’s 18,000 employees represent “a goldmine of ideas. If we continue to give them the opportunity to bring ideas to the table, that’s the best recognition they can have.”

Companies that treat their supply chains as a series of functional siloes will solve small pieces of the puzzle. “But the real bang happens when you think about the extended value stream,” says Buseman. Through collaboration, an organization with eight staging points for material might be able to eliminate two or three, while maintaining the same level of service.

Avnet doesn’t view the challenge of improving operations as involving “one big event” that can solve all of its problems. Instead, it seeks incremental change, recognizing teams’ success as they create ongoing opportunities for savings.

The path to Lean is made more difficult by the complexities that surround non-traditional requirements, such as quality and service. Those elements tie directly to the customer’s loyalty to a brand, as well as a company’s overall reputation.

It’s possible to become too Lean, Buseman says. “Any one piece of the value stream can be potentially over-optimized.” Reduced inventory might look attractive on the balance sheet, but when a supply-chain disruption occurs, such as a natural disaster, the lack of buffer stock can frustrate a company’s ability to maintain an uninterrupted flow of product to the customer.

To view the video in its entirety, click here

The task of applying Lean strategies to company operations is "an ongoing journey," says Buseman. These days, Lean is being coupled with Six Sigma and change-management practices to provide the core of internal improvement efforts. "Together, they become a continuous-improvement background," he said.

An effective Lean program requires collaboration among all aspects of the organization. Buseman says Avnet’s 18,000 employees represent “a goldmine of ideas. If we continue to give them the opportunity to bring ideas to the table, that’s the best recognition they can have.”

Companies that treat their supply chains as a series of functional siloes will solve small pieces of the puzzle. “But the real bang happens when you think about the extended value stream,” says Buseman. Through collaboration, an organization with eight staging points for material might be able to eliminate two or three, while maintaining the same level of service.

Avnet doesn’t view the challenge of improving operations as involving “one big event” that can solve all of its problems. Instead, it seeks incremental change, recognizing teams’ success as they create ongoing opportunities for savings.

The path to Lean is made more difficult by the complexities that surround non-traditional requirements, such as quality and service. Those elements tie directly to the customer’s loyalty to a brand, as well as a company’s overall reputation.

It’s possible to become too Lean, Buseman says. “Any one piece of the value stream can be potentially over-optimized.” Reduced inventory might look attractive on the balance sheet, but when a supply-chain disruption occurs, such as a natural disaster, the lack of buffer stock can frustrate a company’s ability to maintain an uninterrupted flow of product to the customer.

To view the video in its entirety, click here